LightSquared signs up open range for rural service

Stephen Lawson |
March 11, 2011

Mobile startup LightSquared announced a deal with rural carrier Open Range on Friday that is designed to extend broadband into remote parts of the U.S. through satellite and terrestrial wireless networks.

On Friday, Trimble Vice President and General Counsel Jim Kirkland testified before the Subcommittee on Commerce, Justice and Science of the House Appropriations Committee on behalf of the coalition.

"Initial technical analyses have shown that the distant, low-powered GPS signals would receive substantial interference from high-powered, close-proximity transmissions from a network of ground stations," Kirkland said in his testimony, according to the coalition. "The consequences of disruption to the GPS signals are far reaching, likely to affect large portions of the population and the federal government."

Kirkland told the House panel that LightSquared's network should not be deployed without a guarantee that GPS won't be affected.

When the FCC granted LightSquared's waiver, it tried to address such concerns by requiring that the carrier work with government agencies and the GPS industry to determine the potential for interference. That process is still under way.

The GPS interference issue will be central to LightSquared's success, said analyst Jack Gold of J.Gold Associates.

"If there's any significant amount of interference, the government's going to get involved and shut them down," Gold said. "Any time you've got a potential risk with a service that's that popular, then you've got a really serious issue."

Deals with reseller partners such as Open Range will also be critical for LightSquared, which by the time it goes commercial will be trying to compete against LTE services from Verizon (VZ) and AT&T and other fast networks at Sprint Nextel (S) and T-Mobile USA. Clearwire, which was first to build a national 4G network, also relies largely on wholesale partners and is struggling financially.

"LightSquared needs to go out and get a bunch of licensees so they can start making some money. They don't want to end up in the same situation Clearwire is in," Gold said.